On January 8, WTI crude oil futures market fell to US $59.61/barrel, or US $3.09, while Brent crude oil futures fell to US $65.44/barrel, or US $2.83. The main reason was Trump’s public speech, which eased the worries about the escalation of the US Iraq conflict. Combined with the unexpected increase of EIA crude oil inventory in the US this week, the decline of crude oil rapidly expanded.
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“As long as I am still the president of the United States, Iran will never be allowed to have nuclear weapons,” Trump said in a national speech at the White House at about 11 a.m. local time on May 8
Trump said that the United States does not have to respond militarily to Iran’s attack on the U.S. military base in Iraq. Iran’s attack is in retaliation for the U.S. bombing of Iranian commander Sulaimani on January 3, and did not cause casualties when Iran attacked the U.S. air base in Iraq.
Turning to the issue of Middle East oil, trump said in his speech that after taking office, the United States has achieved energy independence and is the world’s largest oil and gas producer, “without Middle East oil”. At the end of the speech, trump said that the United States is ready to embrace peace.
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This led to a big shock in the global financial market and a rapid fall in the price of international crude oil.
In addition, the EIA announced that U.S. crude oil inventory increased by 1.164 million barrels to 431 million barrels in the week ended January 3, recording an increase after two consecutive weeks of decline, with the market predicting a decrease of 4.064 million barrels. WTI crude oil fell more after the data was released.
According to the business community, despite the temporary release of easing signals from the US Iraq conflict, the conflict still exists and the direction of the situation is uncertain. Therefore, in the short term, crude oil will continue to fluctuate broadly.